Question
ABZ Corp. is investing in a new equipment that will be financed by issuing new 20-year, $1,000 par, 8.0% semiannual coupon bonds. The bonds are
ABZ Corp. is investing in a new equipment that will be financed by issuing new 20-year, $1,000 par, 8.0% semiannual coupon bonds. The bonds are currently selling in the market for $950. Flotation costs on newly issued bonds are $60 The corporations marginal tax rate is 30%. What is the post-tax cost of debt for the newly-issued bonds?
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Financial Management Principles And Practices
Authors: Timothy J. Gallagher
9th Edition
1954156103, 978-1954156104
